Newsletter Export Control

Transcription

1 Newsletter Export Control BAFA s Information Service Special Edition 01/2016 Special Edition Amendment of the Iran Embargo Implementation Day Relief of sanctions Following the verification by the International Atomic Energy Agency (IAEA) that Iran has taken all key steps to downsize its nuclear programme, the so-called Implementation Day occurred on The lifting of sanctions established in Regulations (EU) No. 2015/1861 and 2015/1862 came into effect as from 16 January 2016 (Decision CFSP 2016/37). With this Special Newsletter BAFA intends to give you a first overview of the amendments as well as some guidance regarding application procedures in order to ensure that the application process runs as smoothly as possible. Further information on the lifting of sanctions is available in The revised Information Leaflet of BAFA Development of the Iran Embargo - Implementation Day - at info/ausfuhrkontrolle/de/ arbeitshilfen/merkblaetter/index. html The Information Note of the European External Action Service (EEASD) related to the lifting of sanctions may be found at top_stories/2016/150116_implementation_day_en.htm The Information Note of the US Department of the Treasury may be found at resource-center/sanctions/ Programs/Pages/iran.aspx The information of the United Nations may be found at Please observe the following instructions if you intend to undertake legal transactions, particularly exports to Iran: General Information on Prohibitions and Restrictions Not everything is free The entry into force of Implementation Day does not mean that all business transactions and exports to Iran are permitted. On the contrary, the sanctions on Iran still involve a graduated system of legal transactions and acts that continue to be prohibited or subject to licensing. In cases where the Iran embargo regulation (Regulation EU No. 267/2012) does not explicitly rule it out, the general export control legislation, in particular the EC dual-use regulation (Regulation (EC) No. 428/2009) and the Foreign Trade and Payments Ordinance (AWV) have to be complied with. All the other prohibitions, e. g. arising from the so-called Iran human rights regulation (Regulation (EC) No. 359/2011) continue to apply.

2 2 Original regime of listed dual-use goods is decisive If you intend to export dual-use goods listed in Annex I to EC dual-use regulation (Regulation EC No. 428/2009) you need to determine from which international export control regime the goods originate. The background is: the United Nations took the lists of goods of the international export control regimes as an orientation when drafting the UN Resolution 2231 (2015). This had to be taken into account when transposing the UN Resolution to the Iran embargo regulation. Annex I to the Iran embargo regulation contains the goods from the international export control regime NSG (Nuclear Suppliers Group) and Annex III the goods from the international export control regime MTCR (Missile Technology Control Regime). Regrouping of Annexes As a result of the present amendments, the previous Annexes to the Iran embargo regulation are, in part, revised and regrouped as follows: New regulation Essential content Previous regulation Annex I Goods of NSG regime Subset of previous Annex I Annex II Other proliferationrelated goods Previous Annexes II and III Annex III Goods of MTCR regime Subset of previous Annex I Transferred to Annex II Repealed and not replaced Other proliferationrelated goods Goods of petroleum and gas industry, petrochemical products, key naval equipment, gold and precious metals Annex III Annexes IV, IVA, V, VI, VIA, VIB and VII Annex VIIA Industrial software Annex VIIA Annex VIIB Graphite and metals Annex VIIB Annex VIII, IX Lists of persons and entities Annexes VIII, IX Annex X List of competent authorities Annex X Repealed and not replaced Annexes XIII, XIV List of goods subject to restrictions hitherto suspended List of persons and entities (presently not filled) Annexes XI, XII When exporting listed dual-use goods to Iran, it is no longer sufficient to be aware of the control item in Annex I of the EC dual-use regulation only. You also need to know whether the item is controlled by Annexes I or III to the Iran embargo regulation. If your goods are controlled by both, Annex I and Annex III to the Iran embargo regulation the coverage by Annex III has priority. In this connection, please note that the numbering system in Annexes I and III does not correspond with the numbering system in Annexes I and III to the Iran embargo regulation. Content-related amendments of the goods lists In addition, the contents of Annexes II, VIIA and VIIB have been changed. In part, some goods were deleted, new goods were added, for instance in Annex VIIB, or goods which were listed in Annex III before were transferred to Annex VIIB. A blank notice you might have received in the past for the newly added goods is no longer valid. In other words, you have to apply for an export licence. Therefore, you should check your goods again. This is also necessary if the goods had already been reviewed by BAFA in the past. Do not confine your review to the Annex of goods to which you were possibly referred by BAFA as being relevant. There are a number of amendments within the lists of goods. Which prohibitions continue to apply? Even after the Implementation Day and the lifting of sanctions the following prohibitions have to be observed: The arms embargo (sect. 74 ff. Foreign Trade and Payments Ordinance AWV), Trade prohibition on MTCR goods (Art. 4a ff. in connection with Annex III to Iran embargo regulation), Financial restrictions and prohibition on making funds available (Sect. 23 ff. in conjunction with Annexes VIII, IX, XIII and XIV to Iran embargo regulation), Trade restrictions on goods intended for internal repression (Art. 1a in conjunction with Annex III of Iran human rights regulation (Regulation EU No. 359/2011)).

3 3 Which authorisation requirements need to be observed? After entry into force of Implementation Day and the lifting of sanctions licensing requirements may result from both, the Iran embargo regulation and the general export control provisions: Authorisation requirement under Iran embargo regulation with NSG goods (Art. 2a ff. in conjunction with Annex I to Iran embargo regulation), with other proliferation-related goods (Art. 3a ff. in conjunction with Annex II to Iran embargo regulation), with software for integrating industrial processes (Art. 10d in conjunction with Annex VIIA to Iran embargo regulation), and Licensing requirements in conjunction with graphite, raw or semi-finished metals (Art. 15a in conjunction with Annex VIIB to Iran embargo regulation). Peculiarities related to restrictions and licensing requirements under Iran embargo regulation In case of the above prohibitions and licensing requirements under the Iran embargo regulation, the following peculiarities need to be observed: Prohibitions or licensing requirements do not only apply to exports to Iran, but also to all exports to Iranian persons, entities or bodies world-wide, independently of where they are located. In accordance with Art. 1o of the Iran embargo regulation, Iranian person means any legal person, entity or body, inside or outside Iran, owned or controlled directly or indirectly by natural or legal persons in Iran. This is assumed if the company is majority owned (50 per cent plus 1) by an Iranian person or Iranian entity. In addition, please note that the licensing requirements do not only apply to exports, but depending on the type goods, also to their sale, transit, supply, transportation, import, trafficking and brokering, and to associated services and investments. In case of NSG goods and goods of Annex II to the Iran embargo regulation, an authorisation is also required for their purchase, transportation and import from Iran. Authorisation requirements under general provisions Where the Iran embargo regulation does not provide for prohibitions and licensing requirements, it does not mean that exports and other legal transactions need no authorisation. On the contrary, you need to check if the other export control provisions require a licence. The specific provisions of the Iran embargo regulations, however, always have priority. General licensing requirements may be as follows: Exports of listed dual-use goods of WA regime and the Australia Group (Art. 3 in conjunction with Annex I to EC dual-use regulation), Exports of nationally listed dual-use goods (sect. 8 (1) no. 2 AWV in conjunction with Part I B of the Export List, where Iran is mentioned as a controlled destination in the relevant Export List item), Exports of non-listed dual-use goods under Art. 4 EC dual-use regulation or sect. 9 AWV, Exports of surveillance technology if it is controlled by Annex IV to Iran human rights regulation, by Annex I to EC dual-use regulation or by Part I Section B of the Export List, Exports of firearms under the firearms regulation (Art. 4 in conjunction with Annex I to firearms regulation (Regulation EU No. 258/2012)). If you intend to export firearms controlled by Part I Section A of the Export List, the arms embargo has priority. Exports of goods of the anti-torture regulation (Art. 5 in conjunction with Annex III to the anti-torture regulation (Regulation EC No. 1236/2005)). Please note in this connection that the export of goods listed in Annex II to the ant-torture regulation is prohibited. Which prohibitions and licensing requirements were repealed and not replaced? With the Implementation Day and the entry into force of Regulations (EU) 2015/1861 and 2015/1862, especially those economic sanctions were lifted which, in part, had already been suspended in the meantime. In addition to certain import and export prohibitions, the previous licensing requirement for fund transfers from or to Iranian persons, entities and bodies should be underlined. Thus, the following prohibitions and licensing requirements were repealed: Prohibition on import and transport of petroleum, petroleum products, petrochemical products and natural gas (former Annexes IV, IVA, V), Prohibition related to key equipment for Iranian petroleum, natural gas industry and for the petrochemical industry (previous Annexes VI, VIA), Prohibition on key naval equipment (former Annex VIB), Prohibition on import and export of gold, precious metals and diamonds (former Annex VII), Prohibition on export of bank notes and coinage to the Central Bank of Iran (former Art. 16)

4 4 Prohibition of making available oil tankers (former Art. 37b) as well as Licensing requirement for transfers of funds (former Art. 30, 30a) How to apply for a licence? Where it is possible and necessary to apply for a licence, please observe the following general principles, i. e.: File your application via the electronic portal ELAN K2. Please enclose with the application a copy of the contract, full company profile of the consignee (self-presentation), detailed technical documents and end-use certificate. For the export of goods listed in Annex I to the Iran embargo regulation you need special certificates related to end-use and end-user verification that have to be issued by Iran. Presently Iran has not designated the issuing authority yet. In case of the export of goods listed in Annex II to the Iran embargo regulation, Iran must grant the exporting state the right to examine the end-use. At present both sides are working on a solution. In the meantime you can already submit your application, including the other documents. BAFA will publish information at its Homepage as soon as the open questions are resolved. If you want to export goods listed in Annex I to the EC dual-use regulation or Annex I to the Iran embargo regulation, or goods listed in Part I B of the Export List, you have to nominate a person responsible for exports. If you already nominated an export officer it is not necessary to designate another person for business with Iran. Which peculiarities apply to licences under the Iran embargo regulation? Peculiarities mainly exist in trade transactions with NSG goods listed in Annex I to the Iran embargo regulation because, before a licence may be granted, it must be submitted to the United Nations Security Council (Procurement Channel). The licence may only be issued after the United Nations Working Group (Procurement Working Group) has approved the granting of a licence. In your case, you should take the following into account: Please note that depending on the individual case your data and documents could be presented to other authorities and states for evaluation. In case of exports of listed NSG goods to Iran you should allow for more time because prior to issuing a licence for goods listed in Annexes II, VIIA and VIIB to the Iran embargo regulation BAFA must inform the other EU Member States, the EU Commission and the EU High Representative ten days in advance. Therefore, you should file your application as early as possible before the planned export and make sure that all documents and supporting data are complete. Incomplete or unclear applications will be probably rejected by the United Nations Working Group. That is why you should apply utmost care in terms of the completeness und correctness of the application papers and clear up possible discrepancies. Queries and replies to the United Nations are not possible. In addition, it is recommended to name all parties involved in the application. This also includes information on parties abroad, financial institutions involved as well as the forwarding agent in charge of transportation and the intended transport route, if known. The designated parties only will be covered by the United Nations approval and the respective licence issued by BAFA. Subsequent amendments are not possible at the United Nations. In such a case, you would have to apply for a new licence to be submitted to the United Nations. Furthermore, the description of the goods should be precise and if possible in English language because these documents or parts thereof may have to be presented to the United Nations. When applying for export of NSG items listed in Annex I to the Iran embargo regulation via ELAN-K2, they should always be put in the first place in the goods list. If you intend to export a number of goods and only one item is covered by Annex I to the Iran embargo regulation it is recommended to split the application and to file a separate one for the item listed in Annex I to the Iran embargo regulation because this is the only part of your export transaction that is subject to United Nations approval. Please indicate that there is a connection between these separated transactions. The Iran embargo regulation also contains a number of reporting requirements of the licensing authorities to ensure compliance with the objectives of the Vienna nuclear agreement. For instance, the obligation to inform the International Atomic Energy Agency about exports completed within a period of 10 days. BAFA can meet this obligation only if you provide the required information in due time. In addition, the federal government must report all details on the exact transport route and the final delivery to the Security Council before the export transaction takes place. In this case, too, the obligation to cooperate with BAFA will have to be imposed on you.

5 5 Advice and information on licence applications and application procedure Export control and BAFA Instructions on how to file applications and to use the ELAN-K2 portal may be found at BAFA s Homepage under Antragstellung. In addition, BAFA published an Information Leaflet Exportkontrolle und das BAFA (Export Control and BAFA) which describes in detail how to communicate with BAFA and mentions the respective contact persons. Electronic application portal ELAN K2 BAFA established a hotline to answer your questions about how to access and handle the ELAN-K2 Portal: Information unit referring to processing status of export licence applications The information unit can tell you the processing status of your application. The hotline may be contacted under the telephone number from 9 a. m. to 3 p. m. Disclaimer This Newsletter is designed to provide latest information about legal and administrative issues and offer guidance to international industry and people dealing with foreign trade. It is a non-official translation of the German version which is the only legally binding version. Imprint Text and editing Federal Office for Economic Affairs and Export Control (BAFA) Press and Public Relations Frankfurter Str Eschborn Phone: +49 (0) Telefax: +49 (0) pressestelle@bafa.bund.de Export Control our contribution to safer world!